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SA gets welcome increase in employment

Employment is up – but so is unemployment.

The publication of the stubbornly high and increasing unemployment rate a week or two before the release of the quarterly employment statistics usually hides the good news that more and more people in South Africa actually do get jobs. 

It’s true – the job market is growing, albeit at a slower rate than the increase in job seekers entering the market and struggling to find a job.

Maybe it is the bad news in the very high unemployment figure of nearly 30% that draws a lot of attention and commentary from all and sundry about what is wrong in SA.

While nobody can deny that the unemployment rate is high, and the nominal figures of unemployed persons and the number of needy households remain a huge concern, the real increase in employment and the statistics relevant to new employment opportunities are just as important to note.

Statistics South Africa publishes both sets of data. The Quarterly Labour Force Survey, which yields information on the number of persons seeking employment and the unemployment rate, surveys 30 000 households, while the Quarterly Employment Statistics survey is conducted among 20 000 registered businesses to collect information on employment in the formal sector and the level of wages and salaries.

Jobs and ‘proper jobs’

The employment survey thus excludes the informal sector and self-employed people in small businesses that are not registered for value-added tax. In short, the employment survey studies the trend in what unemployed people, politicians and community leaders would call “proper jobs” in public meetings and during protest marches.

The figures show that the number of proper jobs is growing, even during the current uncertain economic times. The first finding in the Stats SA report is that employment in the formal, non-agricultural sector increased by some 0.8% compared to a year ago.

Data shows that the formal economy employed 76 000 more people at the end of March 2019 than a year ago.

In the first quarter of 2019, the formal sector silently added 22 000 new jobs while everybody was lamenting the bad state of the economy and how difficult it is to find a job.

The biggest increase in employment numbers was in the trading sector, which added 67 000 jobs compared to a year ago, increasing by 3.1%. This sector includes wholesale and retail trade, repairs to motor vehicles and to personal and household goods, as well as the hotel and restaurant industry.

The business services sector – including financial services, insurance, real estate and general business services – grew employment by 2.5% or 57 000 jobs over the last year. Mining, manufacturing and transport all added a few thousand jobs.

These healthy gains in employment were offset by big declines in two sectors, construction and personal services, which terminated another 63 000 jobs over the last year. The construction industry lost 23 000 jobs since March 2018. That represents a decline of 3.6% in a labour-intensive industry.

Read: SA’s jobs market gets tight

The trials and challenges of the construction industry are well known, especially with regards to big construction companies. Only this week, Group Five announced that more than 3 000 people will be left unemployed following the demise of most of the company’s businesses.

Snakes and ladders

Businesses in the community, social and personal services sector showed a decline of at least 40 000 employees, or some 1.5%, since a year ago. Luckily it showed recovery during the last quarter and chalked up gains of 19 000 jobs, or the total for the year would have been far worse.

Even the mining industry – usually only in the news when one or another mine announces retrenchments – added 5 000 new jobs during the last year net of all the big job losses in the industry.

The Stats SA survey shows that industries in the tertiary sector remain the biggest employers, employing more than eight million of the estimated 10.17 million workers in the formal economy. The manufacturing sector employs 1.3 million people and mines just less than 460 000.

Further analysis of the employment figures discloses some good news: job losses were mainly confined to part-time employees, while full time employment increased significantly.

Around 54 000 part-time jobs disappeared, but permanent employment increased by 130 000.

Part-time staff either upgraded to full-time employment, or companies are just a little more optimistic and are willing to take on permanent staff.

All sectors added full-time employment, with the glaring exception of the construction industry which shed both full-time and part-time jobs.

Remuneration 

However, the improvement in employment numbers seems to have come at a cost. Stats SA’s research shows that earnings barely improved over the last year and lagged inflation by far.

Total gross earnings increased by only 3.7% since March 2018. The good news is that basic wages and salaries increased by 5.8% in line with the trend of offering proper jobs.

The bad news is that the tough economic conditions hit bonus and overtime earnings hard. These nice little extras declined by nearly 14% compared to a year ago.

Given the higher number of employees and small increase in total earnings, average monthly earnings would have increased by only 2.9% to R22 538 per month in March 2019 compared to R21 894 in March 2018.

The net increase of 76 000 jobs over the last year might not seem like much and pales in comparison to the number of unemployed still hoping to land a job, but it still is a significant number.

It is around 1 000 school buses full of workers making their way to work every morning and probably puts food on the table for nearly 200 000 people.

Figures in older Stats SA reports show that employment in the formal sector has increased by nearly a million people since March 2015. And when business and consumer confidence start to improve, the rate of creating new jobs will hopefully improve as well.

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COMMENTS   13

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It looks that however you are trying to spin it the percentage of unemployed increased. In a country with a stable population of 50 million 76000 new jobs would mean a lot. Since the population of SA is growing around 1% every year the number of working age people is growing by over half a million a year. Of course not all of them enter into the job market. If only half of them do it still means that creating 200000 new jobs a year would not reduce the percentage of the unemployment.

South Africa has an “unemployment figure of nearly 30%”…

BHWAAAAA, HA, HA, ha, ha!

SA has a de facto unemployment rate of around 80% – if not more.

90% of the jobs in state departments, provincial departments, municipalities, SOE’s and such, are fake.

Every BEE job is fake.

Leading the BEE pack is the president Ramamamparra – the BEE-BUFFALO-SOLDIER. Everything he has “achieved” was handed to him by SA’s minority-group intellectual servants.

This is at the core of everything that is wrong with post ’94 SA.

The USA has more job openings than people looking for work – for the longest period in its history. A fact you will not hear/see on the entitlement home of the delusional, ultra far left socialist, free-loading, leeches – CNN (and such).

In short: if you want an unemployment rate below five percent, forever, vote for the likes of Donald Trump.

love your description of CCN and cronies

I wonder how often and how intensely and how long the former president of the ANC (and of the country) puzzled over this arithmetic?

He should go and listen to the podcast of Prof.Alwyn Louw on RSG geldsake 24/06/2019

This is paid content..
the writer is a spin dr. just doing his job here trying a cheap spin on the dreadful state of SA’s economy.

Yes tel the ever growing number of jobless young people to chearup, you just have to fight harder for the fewer jobs..

well and non-AA need not even apply.

Dear Adriaan-pse send me some of the good stuff you were using when you wrote this article.I need to get into that same delusional zone to avoid dealing with reality. Thx. PS- i will even pay the postage.

Prof. Alwyn Louw sketched a very very grim picture on RSG geldsake last Friday…..basically there is no hope.

Alright… I’m going to call BS. Every 2nd person I know has been retrenched in the last year. Sure, some were retrenched the year before.

Okay, so, the point of this article is that, despite all the doom and gloom, South Africa is creating some jobs, which is indeed cause for celebration, congrats to those guys who found those jobs…

Still though, much like the official inflation rate vs the “what’s in my shopping trolley” inflation rate, context and reality tell a different story, take a walk through your local mall/shopping center and the miserable facial expressions on many faces say it all.

Those jobs in the financial services sector are all call centre agents who phone me 10 times a day to sell me every type of insurance you can imagine.

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